Is Indonesia Ready for Its Own Auto?
In the past few months we have seen a lot of news about the making of a national car. The Kiat Esemka in Solo was built by a group of students. There was also an electric bus made by the Indonesian Institute of Sciences. But this begs the question: what is actually needed to become a national carmaker? That question has never been sufficiently answered and people always think that making a car would be easier and cheaper than making an airplane.
In some sense, that might be right, but making your own car is certainly not easy. If you take a look carmakers, most of them have been bought up by other car companies or merged with others. Then there are the ones that went bankrupt or on the brink of it.
To make a national car work, we need the country to develop a vehicle based on the needs of the masses, and the willingness of the people to actually buy the car. People must also be convinced that the car being bought is of the same quality as any global brand.
In 1996, we had the Timor, which was a version of the Kia Sephia, and the Bimantara, a revised Hyundai. The idea was that making the Timor and Bimantara would be the basis of an Indonesian national car such as the one in Malaysia, which in 1985 established the Proton (Perusahaan Automobile National). Then the chaos of 1998 came and nothing was left. Meanwhile, the Proton is still present in Indonesia, where the product continues to sell.
If Indonesia wants to make a national car, we should learn from the Proton and its 27-year history in Malaysia. Though Indonesia-Malaysia relations are still a bit sensitive, the similarities between the two countries make Malaysia a perfect benchmark for us.
On July 12, Indonesian media were invited by Proton, under its new management, to learn how the Malaysian carmaker functions. Proton was incorporated on May 7, 1983, to manufacture, assemble and sell motor vehicles and related products (accessories, parts, etc.). Its first car, the Saga, and was commercially launched on July 9, 1985, by Malaysian Prime Minister Dato’ Seri Mahathir Mohamad, who had dreamed of having a national car brand.
The Saga was a redesigned and reassembled Mitsubishi Lancer, which wasn’t a bad idea since Mitsubishi Corporation and the Mitsubishi Motors Corporation offered technical assistance and supplied the components. Proton established the 923,900-square-meter Shah Alam factory, which was designed to produce 80,000 cars a year. This plant also produced the Waja, Satria GTI, Wira, Iswara, Arena, Perdana V6 and the Juara. In 1997, Proton expanded its capacity at Shah Alam by 230,000 cars per year with the construction of the Medium Volume Factor.
The following year, Proton upgraded its engineering capabilities with the acquisition of Lotus Group International Limited, a British automotive engineering company and manufacturer of sports cars. This helped Proton upgrade its car designs, engines and suspension.
In 2000, came the first Proton-designed engine, the Campro, which produced good power while meeting the newest emission regulations. Three years later, a state-of-the-art plant in Tanjung Malim, Perak, about 80 kilometers from Kuala Lumpur, was added. This plant has a capacity of 150,000 units per year, but is currently churning out about 94,000 cars. Tanjung Malim produces the new Proton Preve, Persona and Satria Neo.
Big investments helped build Malaysia’s national car, but consumers still had to decide whether they wanted to buy a Proton. One of the company’s newest products is the Preve, which will arrive in Indonesia in January 2013 (it had originally been scheduled to launch in September 2012) and has been developed to meet global safety standards. There is also the upgraded Proton Exora Bold, which uses a Campro CFE engine, a turbocharged double overhead cam, a VVT engine that can produce 138 hp at 6,500 rpm and is due to arrive in Indonesia in October.
Proton is currently developing a number of concept cars that will be available as production versions around 2013 or 2014. One of this most intriguing concept cars is the Proton Emas, which is a city car that uses hybrid technology for its engine. It’s not yet clear which engine will be used.
This year, Proton changed its majority shareholders from Khazanah Nasional Berhad, which is state-owned, to DRB-HICOM, a privately owned company. At the moment, Proton is restructuring and restrategizing so it can reach potential markets effectively and efficiently. One vital market is Indonesia, according to the company’s chief executive officer, Dato’ Lukman Bin Ibrahim.
After 27 years in the industry, Proton continues to need all the support it can get from any potential investor in order to become a global player.
This is something that Indonesia needs to think about. Are we going to make a national car only for our needs, or are we striving to make it the pride of our country and push it into becoming a well-known brand around the world? Either way it will take years of hard work and perseverance to establish a successful national car brand. So the country needs to think logically and be realistic.